PRESIDENT BARACK OBAMA: Today, I'm announcing my plan to nominate three outstanding individuals to help us tackle some of our most important challenges.

CORNISH: And with that, the president named a new energy secretary, a new budget director, and a new head of the Environmental Protection Agency. In a few minutes, we'll hear more about the EPA nominee. But first, NPR's Mara Liasson has this story on the near completion of the president's second term Cabinet.

MARA LIASSON, BYLINE: President Obama had faced some criticism when some of his first choices for top jobs in the new Cabinet were all white males. But today's announcements included two women and one Hispanic man, Ernest Moniz, the president's choice to replace Steven Chu at the Energy Department. Moniz is also a physicist and a former undersecretary of energy in the Clinton administration.

OBAMA: Since then, he's directed MIT's energy initiative, which brings together prominent thinkers and energy companies to develop the technologies that can lead us to more energy independence and also to new jobs.

LIASSON: Mr. Obama chose Gina McCarthy to replace Lisa Jackson at the EPA. McCarthy is from Massachusetts where she worked for former Governor Mitt Romney. Together, Moniz and McCarthy will have the task of carrying out the president's regulatory agenda on climate change

OBAMA: They're going to be making sure that we're investing in American energy, that we're doing everything that we can to combat the threat of climate change, that we're going to be creating jobs and economic opportunity in the first place.

LIASSON: The president turned to another Clinton administration veteran to head the Office of Management and Budget replacing Jack Lew who recently became Treasury secretary. She is Sylvia Matthews Burwell, a Rhode scholar who is among the young brainy policy wonks who populated the Clinton White House.

OBAMA: In the 1990s, when she was, what, 19, Sylvia served under Jack Lew as deputy director of OMB, part of a team that presided over three budget surpluses in a row. Later, she helped the Gates Foundation grow into a global force for good, and then she helped the Walmart Foundation expand its charitable work. So, Sylvia, knows her way around a budget.

LIASSON: Matthews Burwell will plunge right into the ongoing fight over the budget as the sequester cuts go into effect and both sides wait to see what practical and political impact they have. The president is hoping the public comes to dislike the cuts enough to pressure Republicans in Congress back to the negotiating table, where he said Matthews and her deputy, Jeffrey Zients, could help him make a deal.

OBAMA: I know that Jeff and Sylvia will do everything in their power to blunt the impact of these cuts on business and middle class families. But eventually, a lot of people are going to feel some pain. That's why we've got to keep on working to reduce our deficit in a balanced way, an approach that's supported by a majority of the American people, including a majority of Republicans.

LIASSON: Later, at a Cabinet meeting, Mr. Obama repeated that the balanced approach he's looking for to replace the sequester is the same elusive grand bargain that would cut the deficit over the long term, but spare investments in education and basic research.

OBAMA: I will continue to seek out partners on the other side of the aisle so that we can create the kind of balanced approach of spending cuts, revenues, entitlement reform that everybody knows is the right way to do things.

LIASSON: But Republicans, having called the president's bluff on the sequester, say they won't consider any plan that raises revenue. And today, the president vowed that despite the budget battles, he'll continue moving forward on his other priorities, like comprehensive immigration reform, early childhood education and gun violence. With today's nominations, the president has only to name successors for labor, transportation and the U.S. trade representative. In the meantime, all three of the people he nominated today will need confirmation by the Senate.